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Ambac Assurance to contribute $850 million to new Connie Lee unit under capitalization plan
By Angela McDaniels
Tacoma, Wash., July 7 - Ambac Financial Group, Inc. said it plans to capitalize its Connie Lee subsidiary with an $850 million contribution of capital by Ambac Assurance Corp.
This contribution would bring Connie Lee's total capital to slightly over $1 billion, according to a company news release.
Ambac said the new capital will support the claims-paying resources for Connie Lee's financial guarantee business, which will focus solely on U.S. public finance and global infrastructure transactions.
The company has been in communication with Moody's and Standard & Poor's in pursuit of Aaa/AAA ratings for Connie Lee, the release stated.
Ambac will seek formal approval from the Office of the Commissioner of Insurance for the State of Wisconsin for capitalization of Connie Lee and, after having "positive" preliminary discussions with the office, believes the plan will be approved.
"Connie Lee is a licensed financial guarantee company, with access to more than 37 years of industry-leading experience in the municipal bond guarantee industry and as such, we expect that it will be received favorably by the market as it will provide much needed capacity and execution capability," Ambac president and chief executive officer Michael Callen said in the release.
The management team of Connie Lee will be primarily assembled from within Ambac Assurance's public finance division, Callen noted.
Ambac Financial Group is a New York-based holding company whose affiliates provide financial guarantees and financial services. Its principal operating subsidiary, Ambac Assurance., guarantees public finance and structured finance obligations.
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